enoch01
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Posts posted by enoch01
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The devious side of me wonders if this is somebody trying to buy up what they can under $10.
Anyway, I drastically reduced my exposure today. I'm hoping volatility premiums on LEAPs come down (which they probably won't).
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It is hard not to let the price chart influence the decision-making process. This is a 50 cent dollar at the current price. Everybody now: "fortress balance sheet".
Is it still 50 cent dollar?
How much would you pay for $20Billion in annual pre-provision net revenue (including put-back expenses) in the Fed's stress scenario? Just on that case I think this is a 50cent dollar.
But if we dare: how much would you pay for, say $30Billion in a more normal environment (are we allowed to even talk about normal environments yet)? How much would you pay if you knew they wouldn't be allowed to fail?
It would take a long time for bac to get back to 20+Maybe. But this is a financial, it's leveraged. I think everyone was panicking about massive dilution, and at the end of last year that was providing a positive feedback to drive the price down. That turned into people worrying about a bank run, Chris Whalen writing about a restructuring, etc. That phenomenon could reverse just as quickly, especially when everyone realizes Moynihan has built a castle of liquidity and is on a mission to squeeze waste (and risk) out of the company.
Imagine what could happen if the Fed allows, say, a 40 cent annual dividend, starting this summer (hey a guy can dream).
But I'm not trying to convince anyone of anything...
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It is hard not to let the price chart influence the decision-making process. This is a 50 cent dollar at the current price. Everybody now: "fortress balance sheet".
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200% notional in LEAPS (youngish and not a money manager). Hoping to have the good fortune to have AIG remain cheap a little longer so I can roll some BAC gains into it.
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I am thinking that if BofA gets to 7.5% Tier 1 Basel III as planned by the end of this year, they have already made it. The rest comes from the loan runoff and the monetization of the deferred tax thingy.
Pretty soon everyone is going to be talking about Bank of America's "fortress balance sheet" - just a matter of time now.
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To be released on a Thursday - therefore I'm guessing good news generally.
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Mortgages are non-recourse in the US, which is why "it's different" in Canada. You have to declare personal bankruptcy to get out of your poorly devised home ownership plan. The result is that downward price trends are throttled because home owners can't just walk away like they did in the US. I think RE prices will be forever buoyed by two things that people are loathe to do: one declaring bankruptcy and two selling at a loss.
Wait until the stigma wears off once people start looking at the economics of their situation. Or maybe you were being sarcastic, sorry if I couldn't tell.
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Nope. Nobody is saying Buffett is arguing for voluntary taxes (whatever that is). And nobody is accusing him of believing that only he isn't paying enough. Still, Buffett is saying he, among others, doesn't send enough money to the Treasury. Christie is inviting him to live up to his word, send in more, and be done with it, if that's what he believes. There's no need to engage in the farce of goading others who disagree with the implied premise that more taxes are the answer. He's better than that.
You are doing the same thing that Christie is doing.
He's responding to absurdity in kind. Anyone who has just a passing knowledge of the man knows that Buffett means more than "I don't pay enough". The absurdity arises when Buffett presumes (either through feint or sincere belief) that taunting others will have any effect on the national debate, since they disagree with him on a philosophical level.
OK, I'm done on this one.
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Thanks guys for posting these! :)
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That's just way over the top. I think you guys are completely misreading him. He's not saying "shut up!" in a vacuum, as if a private citizen isn't allowed to contribute to the debate. He's saying "write the check and shut up!". In other words: Enough beating around the bush with words and games. If you think rich guys like yourself aren't sending enough money to Washington, then lead by example and send in your money.
Total straw man and distortion of what Buffett is arguing for.
Buffett has already explained countless times why he's not arguing for voluntary taxes and why it wouldn't work, and he's not arguing that it's just him who's not paying enough taxes, so sending a check wouldn't fix anything.
Nope. Nobody is saying Buffett is arguing for voluntary taxes (whatever that is). And nobody is accusing him of believing that only he isn't paying enough. Still, Buffett is saying he, among others, doesn't send enough money to the Treasury. Christie is inviting him to live up to his word, send in more, and be done with it, if that's what he believes. There's no need to engage in the farce of goading others who disagree with the implied premise that more taxes are the answer. He's better than that.
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Are you going to offer an argument for why Christie was wrong for what he said, or why on this issue Buffett isn't more of a demagogue than Christie?
Because it's dumb and hypocritical. I don't support spending as much on the military than the next 6 countries combined. Does that mean I can just tell Christie to write a check out of his account for the next F-16 or nuclear submarine and shut up?
There is no analogy here. The debate is over whether the nation's finances should be balanced through increased taxes, decreased spending, or a mix. Buffett is ignoring that issue, and is instead playing a game. Christie is calling him on it.
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Christie by saying what he is saying is simply choosing to ignore the debate or dicussion. He's saying that Buffett, as a citizen of the country, should not be allowed to voice his opinion about what changes should be made to how the country is governed.
That's just way over the top. I think you guys are completely misreading him. He's not saying "shut up!" in a vacuum, as if a private citizen isn't allowed to contribute to the debate. He's saying "write the check and shut up!". In other words: Enough beating around the bush with words and games. If you think rich guys like yourself aren't sending enough money to Washington, then lead by example and send in your money.
Christie is not ignoring the debate. He's knee-deep in it, as his actions as governor have demonstrated.
(not a New Jersey resident, BTW)
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Of course, that is trivially true.
I guess remembering the obvious is hard, then, because so many people seem to forget it...
Your trivial point was consistent with my argument. I was just being charitable.
Are you going to offer an argument for why Christie was wrong for what he said, or why on this issue Buffett isn't more of a demagogue than Christie?
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Christie took difficult, unpopular steps to try and right New Jersey's finances. He's earned some goodwill to discuss this issue publicly.
Someone doing something right doesn't mean that when he does something wrong it doesn't count.
Of course, that is trivially true.
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More demagogery ::) Doubt he's telling people talking about issues he agrees with to shut up..
Christie took difficult, unpopular steps to try and right New Jersey's finances. He's earned some goodwill to discuss this issue publicly.
Buffett chooses to use his wealth to farcically goad senators, who've never agreed that sending more money to Washington is the solution to the nation's problems, instead of writing a check to the Treasury. He knows they won't take him up on the offer, but he also knows they don't agree with his premise. So who is being a demagogue, again?
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The CDS coup was a lucky stroke for Paulson and now we are watching him revert to his mean. And as far as I'm concerned all he is doing is making market calls and buying gold right now.
Heck, by now we know he is Mr. Market, he was selling BAC to us for 5 bucks or below.
Careful everyone. As Paulson said in his FCIC testimony "we're pretty much experts in financials" [39:45].
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And hopefully Gundlach's prediction of a drop in the S&P to 500 will come true as well (1 year left):
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This I see as something else that will get passed on to customers. I'm more excited about the Volcker Rule going into effect; it has a better chance of actually modifying the culture in banks.
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On the second point: I kind of doubt anyone on this board does this.
Oh, people on this board definitely do that.
Several times I have had to push back after some claim that the price action of a particular stock accurately reflected the economic prospects of the security.
I've also had to push back on people who contended the opposite -- that board members who were increasingly optimistic about the economic prospects of an investee company were actually fooling themselves because of the upward price action.
Interesting, thanks for that. I see tombrgt mentioned it as well. I must not be paying enough attention. :D
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Actually, it only fell another 22%.
Still...that's like calling a bottom on the Dow at 10,000 and then it falling below 8,000 in the next couple months. My point is more that people shouldn't judge positions based on a very short term move in the stock price.
On the first point: if it had fallen from 25,000 (which would be analogous), the call at 10,000 would actually look pretty good.
On the second point: I kind of doubt anyone on this board does this.
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JP Morgan and Wells Fargo have already reserved for their share:
http://www.marketwatch.com/story/jp-morgan-wells-fargo-reserved-for-settlement-2012-02-09
Don't know about the others yet...
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im puzzled by people saying things will turn out well for Berko.
He lost over 32% last year. To get back to breakeven, his fund has to move up 47%. If you really believe his fund will perform that well, you should be buying it hand over fist.
...or you could have bought / be buying the same securities hand over fist.
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Are the other big banks trying to become more like Wells Fargo? Does that mean Wells Fargo will have more competition in its heretofore wheelhouse of banking basics and cross-selling? All else being equal, I might be that much more nervous if I were them, or one of their shareholders.
Of course, not all else is equal, but it's an interesting thought experiment.
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Bank of America is shaping up into a value investing case for the history books.
I think that's right. We still have a long way to go to intrinsic value. This is doubly true if the judge's opinion reverberates through the rest of BAC's litigation issues:
"Bank of America, as a corporate parent, isn’t responsible for the liabilities of Countrywide, the mortgage lender it acquired in 2008, U.S. District Judge Mariana Pfaelzer in Los Angeles ruled yesterday."
That's icing on the cake in my book.
People will ask, where were you when BAC was at $5 in Dec 2011?8)
BAC dividend increase
in General Discussion
Posted
http://www.bloomberg.com/news/2012-03-14/pandit-repeats-moynihan-misstep-as-fed-rebuffs-citigroup.html
Moynihan is going to make BAC pretty close to the safest big bank in the U.S.
We can buy this right now at a discount to TBV.